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Standing at the intersection of Carpenter Road and 33rd Ave. SE Jan. 24th City of Lacey Public Works Director Scott Egger (left) and City Engineer Roger Schoessel outline several targeted city roads in need of repair, including Carpenter and Hogum Bay roads. Steve Bloomsbloom@theolympian.com

Standing at the intersection of Carpenter Road and 33rd Ave. SE Jan. 24th City of Lacey Public Works Director Scott Egger (left) and City Engineer Roger Schoessel outline several targeted city roads in need of repair, including Carpenter and Hogum Bay roads. Steve Bloomsbloom@theolympian.com

Lacey voters to decide whether to raise sales tax to maintain roads

Informational mailers have been sent, ballots are in the mail, and in about two weeks Lacey officials will learn whether city residents support Proposition 1.

What’s Proposition 1? That’s the Lacey ballot measure that seeks to raise the local sales tax to 8.9 percent from 8.7 percent to fund the city’s Transportation Benefit District, which will then pay for road and sidewalk maintenance. The tax increase is expected to raise between $1.6 million and $1.8 million annually for 10 years.

The deadline for mail-in ballots is Feb. 14.

If voters approve the measure, which would take effect July 1, the city will continue to maintain a network of roads that are in pretty good shape. The city’s streets, based on a pavement condition index, rate about 85 out of 100, one of the highest PCIs in the state. A score of 100 is a new road, while under 50 is a failing street in need of major work.

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If voters don’t support the measure, then it’s back to the drawing board for a city that has recently exhausted available funds for road maintenance.

But city officials, who met regularly with civic groups and other organizations throughout 2016 about the city’s plan, say they have encountered little opposition and won the support of local business owners.

Without proper maintenance, city street repairs can quickly triple in cost, he said.

“They have paid for this infrastructure,” Greenstein said about Lacey taxpayers. “We wouldn’t be doing our fiduciary responsibility if we didn’t seek to maintain the infrastructure they paid for.”

THE GREAT RECESSION

It wasn’t long after Lacey Mayor Andy Ryder was first elected to the council in 2010 that he knew the city would have to change course on its road maintenance funding. The city was beginning to feel the effects of the recession, he said.

The city used to transfer $1 million per year — $850,000 from its general fund and $150,000 in capital funds — to cover the cost of road maintenance, also known as the city’s overlay program. But when the recession created deficits in the city’s budget, the city had to dedicate those funds to operations, Finance Director Troy Woo said.

Those yearly transfers came to an end in 2013, City Manager Scott Spence said, and the city began using reserves to cover road maintenance needs through 2016.

“Now we’re in the circumstance where we need to come up with a permanent solution,” Ryder said.

FUNDING CHOICES

The creation and funding of Transportation Benefit Districts is nothing new in Washington state. There are about 90 in existence throughout the state, most of them funded by car tab fees. The city of Olympia elected to go the car tab fee route, while the city of Tumwater let voters weigh in on a sales tax increase last year. Voters approved it.

Lacey City Council could have enacted a car tab fee of $20 without a public vote, but chose to let voters decide on the sales tax.

“It’s their money,” Greenstein said. “Let the voters weigh in on deciding how we spend their money.”

The car tab fee also doesn’t raise enough money for Lacey’s needs — about $600,000 annually — and the fees would fall directly on city residents and the vehicles they own. In contrast, a sales tax is paid by Lacey residents, but also by anyone driving on city streets to shop in Lacey.

Car tab fees are permanent, while the sales tax increase would end in 10 years if it isn’t renewed, Greenstein said.

The city has crunched some numbers, showing the sales tax will cost residents about $25 a year, based on a $50,000 to $60,000 annual household income. That is less than car tab fees, because most households have two vehicles and would pay $20 for each vehicle, or $40 a year.

$400 MILLION IN ASSETS

Lacey’s road infrastructure is valued at $400 million and has been well maintained. The city’s road network has been expanded by residential developers, who then hand off the roads to the city to maintain.

But if city streets aren’t maintained, the pavement condition index can drop about a point a year. In time, it doesn’t just cost $1 million to fix the road, it costs $3 million to rebuild it.

With regular maintenance, the city can avoid what has happened to Carpenter Road in the area of 33rd Avenue Southeast. That section of Carpenter Road has a pavement condition index of 41, making it a failing street that will have to be replaced at an estimated cost of $1 million, Public Works Director Scott Egger said.

The same goes for Hogum Bay Road in northeast Lacey, which will be funded as a capital project with local, state and federal dollars, he said.

Streets in need of maintenance that would benefit from TBD funding include, according to city engineer Roger Schoessel:

▪ Yelm Highway, between Parkside Drive and the Chehalis Western Trail passenger bridge.

FINAL ARGUMENTS

Although the city hasn’t encountered organized opposition to its TBD funding plan, Lacey resident Vaughn Nelson said he won’t vote for Proposition 1 after he questioned whether the city was considering low-cost strategies, such as chip sealing, for street maintenance.

Egger said the city uses a process called a “slurry seal,” which is half the cost of chip sealing and has the same 10-year lifespan as a chip seal.

Lacey’s ballot measure comes with two written opinions, one in support and another against the sales tax increase. Longtime Lacey resident Ken Balsley offered his opinion in the affirmative.

“Normally I oppose tax increases, but I know how important good streets are for safety and for the future of the city of Lacey,” he said.

Conner Edwards and Glen Morgan opposed Proposition 1.

“Because this measure fails to guarantee that congestion will actually be improved, and raises our already-high sales tax, we ask voters to reject this measure,” they wrote.

Greenstein pointed out that Proposition 1 is not about congestion.

“This isn’t about capital projects. This is about maintaining the existing infrastructure,” he said.

Ryder said Lacey voters can pay now or pay a lot more later to maintain city streets.

“What is the smart business decision? We believe the smart business decision is to maintain the roads,” he said.